Paramount Global stock (NASDAQ
NDAQ
PARA
PARA
Amid the current financial backdrop, PARA stock has suffered a sharp decline of 70% from levels of $35 in early January 2021 to around $11 now, vs. an increase of about 10% for the S&P 500 over this roughly 3-year period. Notably, PARA stock has underperformed the broader market in each of the last 3 years. Returns for the stock were -19% in 2021, -44% in 2022, and -35% in 2023. In comparison, returns for the S&P 500 have been 27% in 2021, -19% in 2022, and 9% in 2023 – indicating that PARA underperformed the S&P in 2021, 2022 and 2023. In fact, consistently beating the S&P 500 – in good times and bad – has been difficult over recent years for individual stocks; for heavyweights in the Communication Services sector including GOOG, META, and NFLX, and even for the megacap stars TSLA, MSFT, and AMZN. In contrast, the Trefis High Quality Portfolio, with a collection of 30 stocks, has outperformed the S&P 500 each year over the same period. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride as evident in HQ Portfolio performance metrics. Given the current uncertain macroeconomic environment with high oil prices and elevated interest rates, could PARA face a similar situation as it did in 2021, 2022 and 2023 and underperform the S&P over the next 12 months – or will it see a recovery?
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